49 Cloudberry Annual report 2022 Sustainability report Our activities Climate related risks and opportunities Financial markets, creditors and investors need clear, consistent, and comparable, high-quality information on the impacts of climate change on businesses. The Task Force on Climate-related Financial Disclosure (TCFD) developed the TCFD disclosure recommendations to improve and standardize the reporting of climate-related financial information and to enhance market transparency and stability. In 2022 Cloudberry has further aligned with the TCFD disclosure recommendations, related to our growth and expansion during 2022, and we developed a more mature reporting. A workshop, facilitated by a third party, reassessed the financial risks- and opportunities. The update was used to determine the most material risks for Cloudberry. A summary report outlining the key elements of each risk and opportunity was developed. A wide range of key personnel were engaged to assist in quantifying each risk and opportunity based on its likelihood, financial impact, and time horizon. In total, ten changes to the risk and opportunities were identified. This was further used to formulate the most material financial risks for Cloudberry, on which the scenario analysis is based upon. Transition risk: Volatile power prices. · As observed in 2022, energy prices are constantly evolving and can, under certain circumstances, be extremely volatile. What are key drivers that could potentially lead to changes in volatility in the future? How might these drivers develop in a transition narrative where the world aligns with a well-below 2˚C scenario? Physical risk: Changing weather patterns. · Changes in average temperatures will impact the climate In the Nordics where Cloudberry currently operates. Overall warmer climate can lead to increased rainfall, increased wind, and longer periods of drought. Potential consequences include flooding at hydro plants resulting in less production, severe winds exceeding a wind turbine`s capacity leading to production stops, and droughts leading to low water levels and forcing the company to reduce or even fully stop the electricity production. The risks were analyzed in two different scenarios. In the Business-as-Usual scenario, aligned with Intergovernmental Panel on Climate Change (IPCC)’s SSP5-8.5 and RCP 8.5 scenario, physical risks dominate the risk landscape. In the well-below 2°C scenario, IPCC’s SSP1-2.6 and International Energy Agency (IEA)’s Net Zero Emissions were used as the premise, and transitional risks dominate. The climate-related risks and opportunities related to Cloudberry`s business development and expansion are assessed annually. The full TCFD report and the scenario analysis is available on our website. Cloudberry’s Carbon Emissions We positively impact the energy transition by developing and producing renewable energy. Sustainability is at the core of everything we do and well-integrated in our long-term strategy. To improve our climate footprint, we must reduce our environmental impact and avoid CO2 emissions wherever possible. In 2022, we improved and conducted our Scope 3 screening of our carbon emissions, aligned with the Greenhouse Gas (GHG) Protocol, focusing on the most material categories of GHG emissions. The company has developed an in-house system to streamline the process of gathering data on emissions, including emissions from the value chain, our operations and Cloudberry`s offices. This will allow us to report GHG emissions on a quarterly basis from 2023. Cloudberry is planning to commit to SBTi and is currently developing a roadmap to reach net-zero no later than 2040. We aim to use this process actively, to identify opportunities to speed up the process and reach net-zero sooner. Table 1. GHG emissions in tons for Scope 1, Scope 2 and Scope 3 Carbon Accounting Unit 2020 2021 2022 Scope 1 Total tCO2e - - - Scope 2 Total Location-Based tCO2e 1 7 5 Scope 3 Total tCO2e 6 978 1 25 820 2 10 723 Total tCO2e 6 980 25 827 10 727 1 Adjusted from 186 tCO2e previously reported for 2020. The number now includes the Scope 3 emissions from construction of the Odal wind farm. 2 Adjusted from 196 tCO2e previously reported for 2021. The number now includes the Scope 3 emissions from construction of the Odal wind farm and the Hån wind farm.
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